New study in the field of wood-processing in Armenia: SMEs to focus on artisan niche products

23 March 2011

A survey of the private wood-processing sector by the EU ENPI Forest Law Enforcement and Governance (FLEG) project revealed a number of challenges faced by the small and medium enterprises (SME) in the forest sector. These included underdeveloped and insecure markets due to low incomes among rural populations, seasonality, poor access to developed markets and unfair competition. The survey highlights that the majority of SMEs operate below capacity due to raw material shortages and unpredictable supplies of domestic wood. Moreover, many companies lack financial resources, technological capacity and operate without modern equipment and tools.
The purpose of the survey was to carry out preparatory work to increase cohesion in the private sector and communication between the authorities and the market. Following the identification of issues in the wood-processing industry, an analysis of recommendations and solutions was undertaken. During the survey, interviews were held with representatives of 37 private wood-processing companies and 13 regional branches of the Hayantar State Non-Commercial Organisation. A database of almost 100 companies working in the Tavush, Lori and Syunik regions was created.
The survey compiled a list of recommendations, including a suggestion to focus on high-value niche products using artisan knowledge and skills, which are in high demand in both domestic and particularly in external markets, instead of mass production.

The survey further recommended developing and implementing a pilot project which would focus on identifying market opportunities for niche products. The pilot project might include the establishment of an association, to be supported through training, identification of market opportunities and supplies of sustainable wood, to name but a few.

FLEG was created to combat threats posed to forests by illegal logging, trade, poaching and corruption. It promotes increased regional and international cooperation, as well as greater law enforcement, governance and transparency.

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